Judging by what T-Mobile executives have shared publicly, the integration of Sprint into the T-Mobile sphere is going swimmingly. But if you’re the Communications Workers of America (CWA), the whole thing stinks.
It’s been two years since T-Mobile closed on the merger with Sprint. Executives at the time joked that they were well prepared for the closure since they had an extended time to get ready for it: The U.S. government took its own sweet time in analyzing the merger, and more than a dozen states challenged the deal in court.
Ultimately, the transaction was allowed to go through, reshuffling the U.S. wireless industry from a four-horse race to three dominant players while Dish Network prepares for battle. It also changed the dynamics for MVNO players, reducing the number of facilities-based carriers available to do business. And it was a bad deal for folks who questioned promises about more jobs, rather than fewer, as a result of the combination of two companies.
The two-year anniversary of the transaction was front and center during T-Mobile’s first-quarter 2022 earnings call on Wednesday.
“It’s hard to believe that it’s already been two years since we closed our merger with Sprint,” said T-Mobile CEO Mike Sievert, who took the reins from John Legere when the Sprint deal closed in April 2020. “I’m incredibly proud of what we’ve accomplished,” consistently exceeding not only their own targets but also Wall Street’s expectations.
T-Mobile said it plans to finish transitioning all Sprint customers to the T-Mobile network over the next few months.
Pre-merger, they laid out a plan to realize “massive synergies” from the scale and efficiencies of their combined assets. “We’re delivering these synergies bigger and faster than expected to the benefit of our shareholders,” Sievert said.
The company is on track to upgrade or decommission substantially all of the Sprint sites this year; it’s been selectively decommissioning sites since the merger closed. As of the first quarter, “we’ve decommissioned roughly one-third of the 35,000 targeted sites,” Sievert said, with a big push coming during the second half of this year. “Remarkable execution by the team as we pulled these milestones forward by more than a year.”
During an investor event last month, T-Mobile CFO Peter Osvaldik said the biggest piece of synergies is related to the network. Decommissioning will be heaviest in the first two quarters of 2022, with the target being those 35,000 cell sites. They ended 2021 with about 8,000 decommissioned cell sites, he said, according to a Seeking Alpha transcript.
The shutdown of Sprint’s 3G CDMA network started on March 31 and is due for final cut-off by May 31. The Sprint LTE network shutdown is set for the end of June.
CWA: 19,840 jobs lost since merger
It’s not a direct result of the network shutdown, but as part of the overall transaction, CWA recently reviewed the impact of the merger on jobs. Its comments were submitted to the Federal Trade Commission (FTC) and Department of Justice (DoJ) to inform their review of corporate merger guidelines.
According to CWA, T-Mobile has eliminated 19,840 jobs since the merger. It also closed 32% of its corporate operated stores, 13% of its third-party stores and 18% of its Metro by T-Mobile prepaid stores since the merger. The average store closures for other wireless carriers over the same period is 7%, a CWA spokesperson told Fierce.
CWA has long argued for worker rights to be considered as part of merger review and antitrust enforcement, ranging from the 1980s breakup of AT&T to the merger of T-Mobile and Sprint in 2020.
The result of the merger for wireless retail workers, who often move between wireless carriers, is fewer job options and less bargaining power, CWA told the FTC in its comments.
While the Covid pandemic has limited the utility of traditional labor market data, anecdotal accounts from workers across the country indicate wireless carriers are suppressing commissions and hiring many part-time workers, which limits eligibility for benefits, CWA stated.
Fierce reached out to T-Mobile for comment on the jobs and will update this story with any additional information.
Update: A T-Mobile spokesperson got back to us and said these numbers “are not correct and frankly not even close to our actuals.”
The statement said: “They appear to be uninformed estimates and assumptions. We report out number of employees at year end in our proxy but can share that 2021 was the largest hiring year we’ve ever had, and we continue to be in growth mode with more than 2,100 roles open right now. We do not report out store counts.”